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Summary of Significant Accounting Policies | 12 Months Ended
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Dec. 31, 2025
Summary of Significant Accounting Policies |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements (“financial statements”) and notes thereto included in this Annual Report on Form 10-K have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). The accompanying financial statements include the accounts of Holdings and its consolidated subsidiaries. All significant intercompany accounts and transactions have been eliminated. In the opinion of management, the accompanying financial statements reflect all normal and recurring adjustments necessary to present fairly the Company’s financial position as of December 31, 2025 and 2024, the results of its operations and comprehensive income (loss), changes in its stockholders’ equity (deficit) and its cash flows for the years ended December 31, 2025, 2024 and 2023. Use of Estimates The preparation of the accompanying financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Segment Reporting The Company operates under the following reportable segments:
| ● | Real Estate – comprises the operations of the Company’s owned and independent global franchising operations under the REMAX brand along with corporate-wide shared services expenses.
| ● | Mortgage – comprises the operations of the Company’s mortgage brokerage franchising operations under the Motto brand and mortgage loan processing services under the wemlo brand. Mortgage does not include any charges related to the corporate-wide shared services expenses.
| ● | Marketing Funds – comprises the operations of the Company’s marketing campaigns designed to build and maintain brand awareness and the development and operation of agent marketing technology. This segment has no net income given the contractual restriction that all funds collected must be spent for designated purposes.
The Company presents all other business activities and operating segments which, due to quantitative insignificance, do not meet the quantitative significance tests for reportable segments under Other. See Note 15, Segment Information, for additional information about segment reporting. Principles of Consolidation Holdings consolidates RMCO and records a non-controlling interest in the accompanying Consolidated Balance Sheets for the portion of RMCO owned by RIHI and records net income (loss) attributable to the non-controlling interest and comprehensive income (loss) attributable to the non-controlling interest in the accompanying Consolidated Statements of Income (Loss) and Consolidated Statements of Comprehensive Income (Loss), respectively. Revenue Recognition The Company generates most of its revenue from contracts with customers. The Company’s franchise agreements offer the following benefits to the franchisee: common use and promotion of REMAX and Motto trademarks; distinctive sales and promotional materials; access to technology; marketing tools and education; standardized supplies and other materials used in REMAX and Motto offices; recommended procedures for operation of REMAX and Motto offices; and specifically for Motto franchisees, access to a variety of quality loan options from multiple leading wholesale lenders. The Company concluded that these benefits are highly related and all part of one performance obligation for each franchise agreement, a license of symbolic intellectual property that is billed through a variety of fees including continuing franchise fees, annual dues, broker fees, marketing funds fees and franchise sales, described below. The Company has other performance obligations associated with contracts with customers in other revenue for education, marketing and events, subscription revenue, loan processing revenue, advertising revenue and revenue from marketing as a service (“MaaS”). The method used to measure progress is over the passage of time for most streams of revenue. The following is a description of principal activities from which the Company generates its revenue. Continuing Franchise Fees Continuing franchise fees are fixed contractual fees paid monthly (a) by regional franchise owners in Independent Regions or franchisees in Company-Owned Regions based on the number of REMAX agents in the respective franchised region or office or (b) by Motto franchisees based on the number of open offices. Motto offices reach the full monthly billing once the Motto office has been open for 12 months. Continuing franchise fees are recognized in the month for which the fee is billed and are a usage-based royalty as they are dependent on the number of REMAX agents or the number of Motto open offices. Annual Dues Annual dues are a fixed membership fee paid annually by REMAX agents directly to the Company. The Company defers the annual dues revenue when billed and recognizes the revenue ratably over the 12-month period to which it relates. See the “Deferred Revenue” section below for a reconciliation of the activity in the Company’s deferred revenue for annual dues. Annual dues revenue is a usage-based royalty as it is dependent on the number of REMAX agents. Broker Fees Broker fees are assessed against real estate commissions paid by customers when a REMAX agent buys or sells a property. Generally, the amount paid is 1% of the total commission on the transaction in most regions. Revenue from broker fees is a sales-based royalty and recognized in the month when a home sale transaction occurs. Agents in Company-Owned Regions who joined REMAX prior to 2004, the year the Company began assessing broker fees, are generally “grandfathered” and continue to be exempt from paying a broker fee. Certain agents in Canada do not pay broker fees. As of December 31, 2025, approximately 22% of agents in the U.S. and Canada Company-owned Regions did not pay broker fees. Motto franchisees do not pay any fees based on the number or dollar value of loans brokered. The Company has pricing components that cap broker fees at certain commission levels. If a franchise agreement includes a capped broker fee plan the sales- and-usage-based royalty exception is no longer valid. Therefore, revenue from any agent, even agents on a traditional plan, that operates under a franchise agreement with a capped broker fee is estimated and recognized ratably over the year. Marketing Funds Fees Marketing Funds fees are fixed contractual fees paid monthly by franchisees based on the number of REMAX agents in the respective franchised region or office or the number of Motto offices. These revenues are obligated to be used for marketing campaigns to build brand awareness and to support agent marketing technology. Amounts received into the Marketing Funds are recognized as revenue in the month for which the fee is billed. This revenue is a usage-based royalty as it is dependent on the number of REMAX agents or number of Motto offices. ​ All assets of the Marketing Funds are contractually restricted for the benefit of franchisees, and the Company recognizes an equal and offsetting liability on the Company’s balance sheet for all amounts received. Additionally, this results in recording an equal and offsetting amount of expenses, against all revenues such that there is no impact to overall profitability of the Company from these revenues. In addition, advertising costs are expensed as incurred. Franchise Sales Franchise sales comprises revenue from the sale or renewal of franchises. A fee is charged upon a franchise sale or renewal. Those fees are deemed to be a part of the license of symbolic intellectual property and are recognized as revenue over the contractual term of the franchise agreement, which is typically 5 years for REMAX and 7 years for Motto franchise agreements. See the “Deferred Revenue” section below for a reconciliation of the activity in the Company’s deferred revenue for franchise sales. Other Revenue Other revenue is primarily from:
| ● | Event-based revenue from education and other programs, which is recognized when the event occurs and until then amounts collected are included in “Deferred revenue”.
| ● | Data service subscription revenue, which is recognized when the control of the products or services has transferred to the customer, which may occur at a point in time or over time, depending on the nature of the contract.
| ● | Preferred marketing arrangements, which involves both flat fees paid in advance as well as revenue sharing, both of which are generally recognized over the period of the arrangement and are recorded net as the Company does not control the good or service provided.
| ● | Technology products and subscription revenue, which charges a monthly fee to its customers or a periodic fee to agents who use the products or services.
| ● | Mortgage loan processing revenue, which charges a flat fee per transaction which is recognized when a loan is closed.
| ● | Advertising revenue is generated through advertisements, media and sponsorship sales via our websites. Revenue is recognized as ads are delivered based on the number of clicks or impressions and is recorded net of any commissions paid to advertising agencies, as applicable, as the Company does not control the good or service provided.
| ● | MaaS is a centralized data-driven marketing platform that enables affiliates, such as brokers, owners, agents, and teams, to efficiently launch marketing campaigns. Revenue is generated from affiliate spend on marketing services within the platform and is recognized on a gross basis, as the Company controls the goods or services provided.
Deferred Revenue and Capitalized Contract Costs Deferred revenue is primarily driven by Franchise sales and Annual dues, as discussed above, and is included in “Deferred revenue” and “Deferred revenue, net of current portion” on the Consolidated Balance Sheets. Other deferred revenue is primarily related to event-based revenue. The activity consists of the following (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Balance at | ​ | ​ | ​ | Revenue | ​ | Balance at
​ | ​ | January 1, 2025 | ​ | New billings | ​ | recognized (a) | ​ | December 31, 2025
Franchise sales | ​ | $ | 21,282 | ​ | $ | 5,582 | ​ | $ | (7,983) | ​ | $ | 18,881
Annual dues | ​ | ​ | 12,261 | ​ | ​ | 29,801 | ​ | ​ | (30,462) | ​ | ​ | 11,600
Other | ​ | ​ | 4,083 | ​ | ​ | 21,042 | ​ | ​ | (21,356) | ​ | ​ | 3,769
​ | ​ | $ | 37,626 | ​ | $ | 56,425 | ​ | $ | (59,801) | ​ | $ | 34,250
(a) | Revenue recognized related to the beginning balance for Franchise Sales and Annual Dues was $7.2 million and $11.8 million, respectfully, for the year ended December 31, 2025.
Capitalized contract costs include commissions paid on Franchise sales and other contract costs that are recognized as an asset and amortized over the contract life of the franchise agreement. The activity in the Company’s capitalized contract costs (which are included in “Other current assets” and “Other assets, net of current portion” on the Consolidated Balance Sheets) consist of the following (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | ​ | Additions to | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Balance at | ​ | contract cost | ​ | Expense | ​ | Balance at
​ | ​ | January 1, 2025 | ​ | for new activity | ​ | recognized | ​ | December 31, 2025
Capitalized contract costs | ​ | $ | 3,553 | ​ | $ | 2,735 | ​ | $ | (1,970) | ​ | $ | 4,318
​ Disaggregated Revenue In the following table, segment revenue is disaggregated by geographical area (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | Year Ended December 31,
​ | 2025 | ​ | 2024 | ​ | 2023
U.S. Company-Owned Regions | $ | 122,933 | ​ | $ | 131,375 | ​ | $ | 138,499
U.S. Independent Regions | ​ | 5,821 | ​ | ​ | 6,017 | ​ | ​ | 6,439
Canada Company-Owned Regions | ​ | 39,177 | ​ | ​ | 40,693 | ​ | ​ | 40,805
Canada Independent Regions | ​ | 2,754 | ​ | ​ | 2,758 | ​ | ​ | 2,891
Global | ​ | 16,334 | ​ | ​ | 14,421 | ​ | ​ | 12,754
Fee revenue (a) | ​ | 187,019 | ​ | ​ | 195,264 | ​ | ​ | 201,388
Franchise sales and other revenue (b) | ​ | 18,073 | ​ | ​ | 18,829 | ​ | ​ | 25,794
Total Real Estate | ​ | 205,092 | ​ | ​ | 214,093 | ​ | ​ | 227,182
U.S. | ​ | 54,311 | ​ | ​ | 59,335 | ​ | ​ | 63,791
Canada | ​ | 17,301 | ​ | ​ | 18,521 | ​ | ​ | 19,039
Global | ​ | 1,223 | ​ | ​ | 1,127 | ​ | ​ | 1,031
Total Marketing Funds | ​ | 72,835 | ​ | ​ | 78,983 | ​ | ​ | 83,861
Mortgage (c) | ​ | 13,674 | ​ | ​ | 14,609 | ​ | ​ | 13,993
Other (c) | ​ | — | ​ | ​ | — | ​ | ​ | 635
Total | $ | 291,601 | ​ | $ | 307,685 | ​ | $ | 325,671
(a) | Fee revenue includes Continuing franchise fees, Annual dues and Broker fees.
(b) | Franchise sales and other revenue is derived primarily within the U.S.
(c) | Revenue from Mortgage and Other are derived exclusively within the U.S.
Transaction Price Allocated to the Remaining Performance Obligations The following table includes estimated revenue by year, excluding certain other immaterial items, expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | 2026 | ​ | 2027 | ​ | 2028 | ​ | 2029 | ​ | 2030 | ​ | Thereafter | ​ | Total
Franchise sales | ​ | $ | 5,928 | ​ | $ | 4,707 | ​ | $ | 3,430 | ​ | $ | 2,162 | ​ | $ | 1,052 | ​ | $ | 1,602 | ​ | $ | 18,881
Annual dues | ​ | ​ | 11,600 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 11,600
Total | ​ | $ | 17,528 | ​ | $ | 4,707 | ​ | $ | 3,430 | ​ | $ | 2,162 | ​ | $ | 1,052 | ​ | $ | 1,602 | ​ | $ | 30,481
​ Cash, Cash Equivalents and Restricted Cash All cash held by the Marketing Funds is contractually restricted. The following table reconciles the amounts presented for cash, both unrestricted and restricted, in the Consolidated Balance Sheets to the amounts presented in the Consolidated Statements of Cash Flows (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31,
​ | ​ | 2025 | ​ | 2024
Cash and cash equivalents | ​ | $ | 118,736 | ​ | $ | 96,619
Restricted cash: | ​ | ​ | ​ | ​ | ​ | ​
Marketing Funds (a) | ​ | ​ | 19,332 | ​ | ​ | 17,668
Settlement Fund (b) | ​ | ​ | 55,000 | ​ | ​ | 55,000
Total cash, cash equivalents and restricted cash | ​ | $ | 193,068 | ​ | $ | 169,287
(a) | All cash held by the Marketing Funds is contractually restricted, pursuant to the applicable franchise agreements.
(b) | Represents the net amounts held in the U.S. Settlement Fund as part of the settlement of certain industry class-action lawsuits. See Note 13, Commitments and Contingencies, for additional information.
Services Provided to the Marketing Funds by Real Estate Real Estate charges the Marketing Funds for various services it performs or for payments it makes on behalf of the Marketing Funds to third-party vendors. These services are primarily comprised of (a) building and maintaining the remax.com and remax.ca websites, (b) agent and consumer-facing technology via the BoldTrail platform, (c) dedicated employees focused on consumer-facing marketing initiatives, and (d) various administrative services including customer support of technology, accounting and legal. Costs charged from Real Estate to the Marketing Funds are as follows (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Year Ended December 31,
​ | ​ | 2025 | ​ | 2024 | ​ | 2023
Technology - operating | ​ | $ | 17,950 | ​ | $ | 4,397 | ​ | $ | 4,676
Technology - capital (a) | ​ | ​ | — | ​ | ​ | — | ​ | ​ | (203)
Marketing staff and administrative services | ​ | ​ | 9,043 | ​ | ​ | 5,970 | ​ | ​ | 6,102
Total | ​ | $ | 26,993 | ​ | $ | 10,367 | ​ | $ | 10,575
(a) | During the year ended 2023, the Company determined that certain development projects were no longer needed and therefore $0.2 million, reflecting the cost of work in process assets that would no longer be placed in service, was refunded to the marketing funds.
Selling, Operating and Administrative Expenses Selling, operating and administrative expenses primarily consist of personnel costs, including salaries, benefits, payroll taxes and other compensation expenses, professional fees, lease costs, as well as expenses for outsourced technology services and expenses for marketing to customers, to expand the Company’s franchises. Fair Value of Financial Instruments The carrying amounts of financial instruments, net of any allowances, including cash equivalents, accounts and notes receivable, accounts payable and accrued expenses approximate fair value due to their short-term nature. Accounts and Notes Receivable Accounts receivable arising from monthly billings do not bear interest. The Company provides limited financing of certain franchise sales through the issuance of notes receivable with the associated interest recorded in “Interest income” in the accompanying Consolidated Statements of Income (Loss). Amounts collected on notes receivable are included in “Net cash provided by operating activities” in the accompanying Consolidated Statements of Cash Flows. As of December 31, 2025 and 2024, the current portion of notes receivable was approximately $3.1 million, respectively, and are recorded as a component of “Accounts and notes receivable, net of allowances” on the Consolidated Balance Sheets. The Company records estimates of expected credit losses against its accounts and notes receivable based on historical experience, the credit quality of specific accounts, and general economic conditions that affect the Company’s performance, including changes in interest rates or the number of existing home sales, which are expected to impact the performance of its franchisees, agents and loan originators. These changes are included as a component of “Selling, operating and administrative expenses” in the accompanying Consolidated Statements of Income (Loss). The activity in the Company’s allowances against accounts and notes receivable consists of the following (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Balance at beginning of period | ​ | Charges to expense for changes in Allowance for doubtful accounts(a) | ​ | Write-offs | ​ | Balance at end of period
Year Ended December 31, 2025 | ​ | $ | 11,208 | ​ | $ | 3,278 | ​ | $ | (1,867) | ​ | $ | 12,619
Year Ended December 31, 2024 | ​ | $ | 10,900 | ​ | $ | 1,359 | ​ | $ | (1,051) | ​ | $ | 11,208
Year Ended December 31, 2023 | ​ | $ | 9,111 | ​ | $ | 6,784 | ​ | $ | (4,995) | ​ | $ | 10,900
(a) | Includes approximately $1.0 million, $0.4 million and $1.8 million of expense attributable to the Marketing Funds for the years ended December 31, 2025, 2024 and 2023, respectively.
Accumulated Other Comprehensive Income (Loss) and Foreign Currency Translation Accumulated other comprehensive income (loss) includes all changes in equity during a period that have yet to be recognized in income, except those resulting from transactions with stockholders and is comprised of foreign currency translation adjustments. As of December 31, 2025, the Company, directly and through its franchisees, conducted operations in over 120 countries and territories, including the U.S. and Canada. The functional currency for the Company’s operations is the U.S. dollar, except for its Canadian subsidiaries for which it is the Canadian Dollar. Assets and liabilities of the Canadian subsidiaries are translated at the spot rate in effect at the applicable reporting date, and the consolidated statements of income (loss) and cash flows are translated at the average exchange rates in effect during the applicable period. Exchange rate fluctuations on translating consolidated foreign currency financial statements into U.S. dollars that result in unrealized gains or losses are referred to as translation adjustments. Cumulative translation adjustments are recorded as a component of “Accumulated other comprehensive income (loss),” and periodic changes are included in comprehensive income (loss). Were the Company to sell a part or all of its investment in a foreign entity resulting in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided, it would release any related cumulative translation adjustment into net income (loss). Foreign currency denominated monetary assets and liabilities and transactions occurring in currencies other than the Company’s or the Company’s consolidated foreign subsidiaries’ functional currencies are recorded based on exchange rates at the time such transactions arise. Changes in exchange rates with respect to amounts recorded in the accompanying Consolidated Balance Sheets related to these non-functional currency transactions result in transaction gains and losses that are reflected in the accompanying Consolidated Statements of Income (Loss) as “Foreign currency transaction (losses) gains.” Other Current Assets and Other Assets, Net of Current Portion Other current assets and Other assets, net of current portion consist of the following (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | December 31,
​ | ​ | 2025 | ​ | 2024
Prepaid expenses | ​ | $ | 10,472 | ​ | $ | 12,438
Capitalized contract costs | ​ | ​ | 1,055 | ​ | ​ | 1,008
Other | ​ | ​ | 413 | ​ | ​ | 379
Other current assets | ​ | $ | 11,940 | ​ | $ | 13,825
​ | ​ | ​ | ​ | ​ | ​ | ​
Capitalized contract costs | ​ | $ | 3,263 | ​ | $ | 2,545
Notes receivable, net of current portion | ​ | ​ | 1,791 | ​ | ​ | 1,873
Other | ​ | ​ | 1,251 | ​ | ​ | 1,147
Other assets, net of current portion | ​ | $ | 6,305 | ​ | $ | 5,565
​ Property and Equipment Property and equipment, including leasehold improvements, are initially recorded at cost. Depreciation is provided for on a straight-line method over the estimated useful lives of each asset class and commences when the property is placed in service. Amortization of leasehold improvements is provided for on a straight-line method over the estimated benefit period of the related assets or the lease term, if shorter. Franchise Agreements and Other Intangible Assets The Company’s franchise agreements result from franchise rights acquired from Independent Region acquisitions and are initially recorded at fair value. The Company amortizes the franchise agreements over their estimated useful life on a straight-line basis. The Company also purchases and develops software for internal use. Software development costs and upgrade and enhancement costs incurred during the application development stage that result in additional functionality are capitalized. Costs incurred during the preliminary project and post-implementation-operation stages are expensed as incurred. Capitalized software costs are generally amortized over a term of two to five years. Purchased software licenses are amortized over their estimated useful lives. The Company reviews its franchise agreements and other intangible assets subject to amortization for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is assessed by a comparison of the carrying amount of an asset group to estimated undiscounted future cash flows expected to be generated from such asset. If not recoverable, the excess of the carrying amount of an asset over its estimated discounted cash flows would be charged to operations as an impairment loss. For the years ended December 31, 2025, 2024 and 2023, there were no impairments indicated for such assets. Goodwill Goodwill is an asset representing the future economic benefits arising from the other assets acquired in a business combination that are not individually identified and separately recognized. The Company assesses goodwill for impairment at least annually at the reporting unit level or whenever an event occurs that would indicate impairment may have occurred. Reporting units are driven by the level at which segment management reviews operating results. The Company performs its required impairment testing annually on October 1. The Company’s impairment assessment begins with a qualitative assessment to determine if it is more likely than not that a reporting unit’s fair value is less than the carrying amount. The initial qualitative assessment includes comparing the overall financial performance of the reporting units against the planned results as well as other factors which might indicate that the reporting unit’s value has declined since the last assessment date. If it is determined in the qualitative assessment that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then the standard two-step quantitative impairment test is performed. The impairment test consists of comparing the estimated fair value of each reporting unit with its carrying amount, including goodwill. The fair value of a reporting unit is determined by forecasting results and applying an assumed discount rate to determine fair value as of the test date. If the estimated fair value of a reporting unit exceeds its carrying value, then it is not considered impaired and no further analysis is required. Goodwill impairment exists when the estimated implied fair value of a reporting unit’s goodwill is less than its carrying value. During 2023, the Company recorded a goodwill impairment on its Mortgage reporting unit in its Mortgage Segment. See Note 7, Intangible Assets and Goodwill, for additional information. Income Taxes The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Management periodically assesses the recoverability of its deferred tax assets based upon expected future earnings, future deductibility of the asset and changes in applicable tax laws and other factors. If management determines that it is not likely that the deferred tax asset will be fully recoverable in the future, a valuation allowance may be established for the difference between the asset balance and the amount expected to be recoverable in the future. The allowance will result in a charge to the Company’s Consolidated Statements of Income (Loss). During 2025 and 2024, the Company recorded an adjustment to the valuation allowance on its deferred tax assets, see Note 11, Income Taxes, for additional information. RMCO complies with the requirements of the Internal Revenue Code that are applicable to limited liability companies that have elected to be treated as partnerships, which allow for the complete pass-through of taxable income or losses to RMCO’s unitholders, who are individually responsible for any federal tax consequences. The share of U.S. income allocable to Holdings results in a provision for income taxes for the federal and state taxes on that portion of income. The share of U.S. income allocable to RIHI does not result in a provision for income taxes for federal and state taxes given Holdings does not consolidate RIHI. RMCO is subject to certain global withholding taxes, which are ultimately allocated to both Holdings and RIHI since they are paid by RMCO. RMCO owns two corporate subsidiaries, which unlike RMCO are not pass-through entities. Income in those corporations is taxed at the corporate level, resulting in a provision for income taxes on 100% of their income, unlike domestic income at RMCO, for which a provision for income taxes is recognized on only Holdings share of that income (approximately 60%). The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. Leases The Company determines if an arrangement is a lease at inception. The Company’s operating lease agreements are primarily for corporate office space and are included within “Operating lease right of use assets”, “Operating lease liabilities” and “Operating lease liabilities, net of current portion’ on the Consolidated Balance Sheets. The Company’s lease liabilities represent the obligation to make lease payments arising from the leases and right of use (“ROU”) assets are recognized as an offset at lease inception. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Variable lease payments consist of non-lease services related to the lease. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Many of the Company’s lessee agreements include options to extend the lease, which is not included in the minimum lease terms unless they are reasonably certain to be exercised. Lease costs expense for lease payments related to operating leases (which is substantially all of the Company’s leases) is recognized on a straight-line basis over the lease term and is recorded to “Selling, operating and administrative expenses’ in the Consolidated Statements of Income (Loss). The Company has made an accounting policy election not to recognize ROU assets and lease liabilities that arise from any of its short-term leases. All leases with a term of 12 months or less at commencement, for which the Company is not reasonably certain to exercise available renewal options that would extend the lease term past 12 months, are recognized on a straight-line basis over the lease term. Restructuring Charges During 2025, the Company restructured its support services intended to further enhance the overall customer experience. As a result, the Company incurred $2.7 million of severance and related expenses and an equity compensation benefit of $0.4 million, which are recognized as “Selling, operating and administrative expenses” in the Consolidated Statements of Income (Loss). See Note 8, Accrued Liabilities, for a roll forward of the liability. During the fourth quarter of 2024, the Company restructured its support services intended to further enhance the overall customer experience. As a result of this restructuring, for the year ended December 31, 2024, the Company incurred $1.3 million of severance and related expenses and accelerated equity compensation expense of $0.3 million, which are recognized as “Selling, operating and administrative expenses” in the Consolidated Statements of Income (Loss). See Note 8, Accrued Liabilities, for a roll forward of the liability. During the third quarter of 2023, the Company announced a reduction in force and reorganization (the “Reorganization”) intended to streamline the Company’s operations and yield cost savings over the long term. The Reorganization reduced the Company’s overall workforce by approximately 7% and was substantially complete by the end of the third quarter. As a result of the Reorganization, the Company incurred a pre-tax cash charge for one-time termination benefits of severance and related costs of $4.3 million and accelerated equity compensation expense of $0.5 million, which are recognized as “Selling, operating and administrative expenses” in the Consolidated Statements of Income (Loss). See Note 8, Accrued Liabilities, for a roll forward of the liability. Equity-Based Compensation The Company recognizes compensation expense associated with equity-based compensation as a component of “Selling, operating and administrative expenses” in the accompanying Consolidated Statements of Income (Loss). All equity-based compensation is required to be measured at fair value on or just prior to the date of grant and is expensed over the requisite service period, generally over three-years, and forfeitures are accounted for as they occur. The Company recognizes compensation expense on awards on a straight-line basis over the requisite service period for the entire award. See Note 12, Equity-Based Compensation, for additional discussion regarding details of the Company’s equity-based compensation plans. Severance and Retirement Plan On December 2, 2025, the Compensation Committee of the Board of Directors modified the Severance and Retirement Plan previously adopted by the Company on May 24, 2023 (the “Plan”). The Plan provides benefits to eligible employees and executive officers of RE/MAX, LLC and its subsidiaries, in the event of (i) involuntary termination of their employment due to position elimination, reduction in force, or other circumstances that the employer determines should result in payment of benefits, or (ii) voluntary termination of employment due to retirement for employees who meet the retirement eligibility criteria in the Plan, subject in both cases to certain restrictions set forth in the Plan. In the case of involuntary termination, these benefits include salary continuation, a health benefits stipend, outplacement services and a possible pro-rated bonus. In the case of retirement, these benefits include modification of vesting of restricted stock awards (for employees who are eligible for restricted stock awards) and a possible pro-rated bonus. Any associated equity compensation expense will be accelerated through the employee's retirement eligibility date. ​ Foreign Currency Derivatives The Company is exposed to foreign currency transaction gains and losses related to certain foreign currency denominated asset and liability positions, with the Canadian dollar representing the most significant exposure primarily from an intercompany Canadian loan between RMCO and the Canadian entity for INTEGRA. The Company uses short duration foreign currency forward contracts, generally with maturities ranging from a few days to a few months, to minimize its exposures related to foreign currency exchange rate fluctuations. None of these contracts are designated as accounting hedges as the underlying currency positions are revalued through “Foreign currency transaction gains (losses)” on the Consolidated Statements of Income (Loss) along with the related derivative contracts. Maturities of the foreign currency forward contracts are included within “Net cash provided by operating activities” on the Consolidated Statements of Cash Flows, with any non-cash portion included as a component of “Changes in operating assets and liabilities - Other assets and liabilities” on the Consolidated Statements of Cash Flows. During the years ended December 31, 2025, 2024 and 2023, the Company recognized a net loss of $1.0 million, a net gain of $3.5 million and a net loss of $1.1 million, respectively, on the derivative contracts. The Company had a short-term $44.0 million Canadian dollar forward contract that matures in the first quarter of 2026 that net settles in U.S. dollar based on the prevailing spot rates at maturity. Recently Adopted Accounting Pronouncements In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires greater disaggregation of income tax disclosures related to the income tax reconciliation and income taxes paid. The amendments improve the transparency of income tax disclosures by requiring (1) consistent categories and greater disaggregation of information in the rate reconciliation and (2) income taxes paid disaggregated by jurisdiction. The Company adopted this standard, effective December 31, 2025 on a prospective basis. See Note 11, Income Taxes for additional information. New Accounting Pronouncements Not Yet Adopted In November 2024, the FASB issued ASU 2024-03, Income Statement (Topic 220) – Disaggregation of Income Statement Expenses (“ASU 2024-03”), which requires enhanced disclosures around disaggregation of certain income statement expense lines into specified categories. The new standard applies to public business entities and is effective on a prospective basis for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company believes the amendments of ASU 2024-03 will not have a significant impact on the Company’s consolidated financial statements and will include all required disclosures upon adoption. In September 2025, the FASB issued ASU 2025-06, Intangibles (Topic 350) – Targeted Improvements to the Accounting for Internal-Use Software (“ASU 2025-06”), which clarifies and modernizes the accounting for costs related to internal-use software. The amendments remove all references to project stages in Accounting Standards Codification (“ASC”) 350-40 and clarify the threshold entities should apply to begin capitalizing costs. The new standard is effective for annual periods beginning after December 15, 2027, and interim periods within those fiscal years. The amendments can be applied using a prospective, retrospective, or modified transition approach. The Company believes the amendments of ASU 2025-06 will not have a significant impact on the Company’s consolidated financial statements or required disclosures.

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